Dismay as economic reformer quits

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The Independent Online


Moscow - Russia's top reformer, First Deputy Prime Minister Anatoly Chubais, resigned yesterday, making clear he had lost President Boris Yeltsin's trust.

"The President's evaluation of my personal work has become known to me in recent days - sharp and negative," he said.

Economists said his resignation meant President Yeltsin was easing up on reform in the wake of the strong Communist showing in December's election.

Mr Chubais, the latest in a series of liberals to leave Mr Yeltsin's team, warned against a change of economic policy. "I am assuming that we are not talking about a change in the economic course in the country ... I am convinced that a change of course, especially now, five months before an election, would be a monstrous mistake."

Mr Chubais, 40, was the longest-serving member of Russia's economic team and since early 1994 the last major reformer left in the government. He won friends at the International Monetary Fund (IMF) and at the Group of Seven industrial countries with his tough promises and his grasp of Western economic principles. But he made enemies among conservatives and Communists at home, who said privatisation was pouring wealth into the pockets of the rich. Western economists in Moscow said yesterday they were dismayed.

"It means Yeltsin thinks he's getting rid of a political liability and he does not want to support Chubais's programme that fighting inflation is the essential short-term priority," one Western economist said.

"He wants to pursue other objectives. I think this is an attempt to spend more money, support more enterprises and a willingness to give up some points on inflation."

The government's willingness to pursue reforms will be scrutinised by a delegation from the IMF, which arrived in Moscow yesterday for talks on a new three-year loan, likely to be around $9bn (pounds 5.8bn).

Under Mr Chubais the government stabilised the rouble and brought down monthly inflation to 3.2 per cent in December.